Enterprise News

Seeing the silver lining

May 08 issue

Ashish Patel, MD at venture capital (VC) investor Intel Capital, believes that Europe still offers good opportunities for early-stage technology investment, despite evidence of a slowdown in activity at the smaller end of the market.

‘Although the first quarter of 2008 showed an uptick in VC investing, if you look at the levels seen in the past three quarters of 2007, it’s flat to down,’ says Patel (pictured), who adds that the withdrawal of private equity behemoth 3i from early-stage investment has added to the gloom.

Intel Capital remains an active, indeed aggressive investor in technology ventures worldwide. In the first quarter of 2008 it committed US$83 million (£42 million) to 36 deals, less than a fifth of which went into North American companies. That compares with $639 million invested in 166 deals during 2007.

Much of this investment is focused on what Patel sees as the exciting potential of WiMAX, a standard for wireless data delivery. To date, Intel Capital has committed $850 million to backing ventures that would gain from widespread adoption of WiMAX, including network operators Freedom4 in the UK and Worldmax in Holland.

‘Over time, the concept of broadband will change from accessing the internet from a particular location to a personalised service wherever you are,’ he argues.

Backing the best
Patel says that Intel Capital invests in the best ideas and entrepreneurs, regardless of where they are based or their stage of development.

‘A paradigm shift is happening, which in Europe we’ve been slow to grasp,’ he says. ‘There is a shift in wealth creation to China and India, which are growing at a mind-boggling rate. These countries have the intellectual capacity, the people and the markets to create massive wealth, and we can only compete if there’s a continuous flow of ideas that continue to get funded.’